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SIPDIS 
 
STATE FOR R/MR, I/PP, WHA/BSC, WHA/PDA, INR/IAA 
 
E.O. 12958: N/A 
TAGS: KMDR KPAO PGOV ECON PREL SNAR EFIN CI
SUBJECT:  CHILE MEDIA REPORT - JULY 13 
July 13, 2009 
 
Chile-U.S. 
---------- 
¶1.  Secretary Hillary Clinton informed the Bachelet government that 
the United States would not support Jose Miguel Insulza's reelection 
to the OAS.  The United States reiterated its position just before 
Bachelet's visit to Washington.  Sources in Washington and of the 
GOC confirmed on Friday (7/10) that Secretary Clinton herself had 
communicated twice with the Bachelet government over the past weeks 
to express its concern with Insulza's efforts for Cuba to reenter 
the OAS.  Sources tied to the Democratic Party said that Secretary 
Clinton was concerned about Insulza's push for Cuba to reenter the 
OAS without conditions, when the United States was doing exactly the 
opposite. Washington sources said that on June 2, Clinton had 
informed Chilean officials, including Foreign Minister Fernandez, 
that "the United States did not view Insulza's reelection 
positively" (El Mercurio, 7/12). 
 
¶2.  The OAS resolution to eliminate the ban on Cuba's membership 
generated a wave of criticism in the United States that did not 
leave the Obama administration indifferent;  Influential Hispanic 
Senator Robert Menendez was among those who strongly criticized the 
resolution. Sources tied to Assistant Secretary Thomas Shannon said 
Clinton spoke to the Chilean government again just before Bachelet 
traveled to Washington to reiterate that the United States would not 
support Insulza's reelection. The crisis in Honduras was another 
element in this matter.  Clinton's appointment of President Oscar 
Arias as the sole negotiator in the Honduran crisis was a major blow 
to Insulza, because it relegated him to a secondary role in the 
resolution of the crisis (El Mercurio, 7/12). 
 
¶3.  CNN interviewed OAS Secretary General Insulza to discuss the 
press report that the United States would not support his reelection 
to the OAS.   Insulza denied this, basing his argument on official 
sources such as Chilean Foreign Minister Fernandez and Assistant 
Secretary State Thomas Shannon. But CNN insisted that its 
correspondents had "confirmed the information with Department of 
State sources" (Mercurio, 7/13). 
 
¶4. Insulza said the news on the eventual rejection of the United 
States to his reelection came as a surprise, adding that "this has 
more to do with Honduras than with anything else (...)  These are 
the same individuals who were lobbying against me in 2005... who 
believe the OAS should be different from what it is today and will 
insist on that" (Mercurio, 7/13). 
 
¶5.  Foreign Affairs Minister Mariano Fernandez refuted press reports 
that the USG had informed of Chile of its position regarding 
Insulza's reelection. In local political circles there was unanimous 
support for Insulza after reports that the United States would not 
give him its vote. However, there is also the general view that 
Insulza's efforts to bring Cuba back into the organization left him 
in an uncomfortable position with regard to the Obama 
administration. Sebastian Pinera suggested Insulza should "apply the 
2001 Democratic Charter with more conviction." Senate foreign 
relations committee member Roberto Munoz said that the U.S. decision 
to replace Insulza as a mediator in the Honduras crisis has left the 
Secretary General in a difficult position (El Mercurio, 7/13). 
 
¶6.  Department of State sources said the United State has not 
informed the Bachelet government of any decision regarding Insulza's 
reelection to the OAS.  Both Secretary Clinton and Assistant 
Secretary Shannon's office said that the only time that Obama and 
Bachelet discussed Insulza was during the Chilean president's visit 
to Washington, when Bachelet "insisted on us supporting his 
reelected.  But we did not commit our position, said the source (La 
Tercera, conservative, independent, 7/13). 
 
¶7.  Assistant Secretary Thomas Shannon said, "The United States has 
not expressed a position to the government of Chile on this issue." 
But it's widely known among those in Washington responsible for 
Latin America that U.S.-OAS relations have become tense over the 
past weeks. They were strained when Insulza sided with Chavez and 
endorsed Cuba's reentry into the OAS without conditions and got 
worse with Zelaya's ousting in Honduras. The USG hoped Insulza would 
seek channels of communication to find a peaceful solution; The last 
straw was Zelaya's attempt to return to Honduras (La Tercera, 
7/13). 
 
¶8.  Foreign Affairs Minister Mariano Fernandez "denied" that the 
United States had notified Chile of its decision not to support Jose 
Miguel Insulza's reelection to the OAS. "That is not accurate. I 
don't know the source. I have spoken three times to her (Bachelet) 
and she has not mentioned this," said Fernandez.  The Foreign 
Minister also expressed his support for Insulza's work. "We've 
received positive opinions from several governments (on Insulza's 
reelection) that we won't reveal, because we must wait for them to 
express this in writing," said Fernandez (La Tercera) and 
government-owned, editorially independent La Nacion, 7/13). 
 
¶9.  Assistant Secretary Thomas Shannon confirmed Foreign Affairs 
Minister Fernandez who denied that the United States has not 
informed the GOC of its position on Insulza's reelection.  Analysts 
believe that the information is a message for Insulza to change his 
approach to some issues (La Nacion, 7/13). 
 
¶10.  In the Senate foreign relations committee hearing, Assistant 
Secretary nominee Arturo Valenzuela focused on the consolidation of 
democracy.  Valenzuela noted that all countries in the hemisphere 
have legitimately elected presidents, which is why the situation in 
Honduras is "unacceptable." Jim DeMint then asked if this meant, 
"That we will use democracy to legitimize autocrats." Valenzuela 
responded, "Democracy's problems must solved in democracy and 
constitutionally" (La Tercera, 7/13). 
 
¶11.  Upon arriving in Santiago, Insulza rebutted reports that the 
United States would not back his reelection: "The few sources that 
have a name are from right-wing people in the United States, which 
oppose the U.S. government. They are not the most qualified sources, 
but for some reason newspapers believe they are credible" 
(Cooperativa Radio on-line, 7/13). 
 
¶12.  "The important thing in the end is that all countries in the 
hemisphere have already established in the OAS the parameters and 
principles that must guide any negotiation in this crisis.... 
Insulza had a crucial role in that which should be considered as 
countries assess the secretary general's reelection" (Boris Yopo 
commentary, La Nacion, 7/12). 
 
Chile-Peru 
----------- 
¶13.  "Chile is always saying, 'We are transparent,'  but this is not 
enough when it buys (weapons) beyond what is considered reasonable 
for any country in the region," said Peruvian Defense Minister 
Antero Flores-Araoz to the information that Chile would be 
negotiating the acquisition of weapons from the United States (La 
Tercera, 7/11) 
 
Chilean and Russian helicopters 
-------------------------------- 
¶14.  Editorial:  "The purchase of...  Russian transportation 
helicopters... has created a controversy....  Some say there was 
pressure from Russia and domestically in this transaction to 
increase bilateral trade with Moscow....  Having diverse suppliers 
has its advantages for national security, especially considering the 
increase in military material of U.S. origin and the precedent of 
the (U.S.) embargo through the Kennedy Amendment.... But the 
technical analysis must have priority and all political 
considerations must be eliminated" (El Mercurio, 7/12). 
 
DEA 
--- 
¶15.  The Public Ministry issued an order for the DEA to join the 
investigation of an operation to smuggle 1.4 tons of ephedrine - a 
chemical used to manufacture methamphetamines - to Mexican cartels. 
The DEA will examine the computers, documents and telephone numbers 
in this case (La Tercera,7/13). 
 
URBAN